The construction industry operates in a business
environment with high levels of risk and uncertainty. Projects are
very complex, operate under tight budgets and timelines, and involve
many people, resources, and subcontractors. There is very little
margin for error in planning and execution.
Construction companies are engaged in constant struggles to
- Increase bid-win ratios;
- Plan for and reduce risk;
- Reduce project costs; and
- Shorten project cycles.
Risk-Based Bid Planning
Before you can worry about execution, you must first get the
contract. Contract bid preparation is perhaps the most critical phase
in a construction project. Without the proper upfront planning and
analysis, even the most attractive projects can quickly become
unprofitable cost sinks. The only way to accurately plan for
construction projects is using sophisticated risk-based planning and
analysis tools.
Many tools on the market might show you the best and worst-case
performance outcomes. But with project budgets in the millions or
even billions of dollars, this simplistic analysis is insufficient.
You need to analyze all possible outcomes and moreover, you
need to know their likelihood of occurring. For example, there is a
substantial difference between a 5% chance or a 20% chance of a $30
million cost overrun. In the latter case, the overrun is four times
as likely to occur!
Solutions
The Vanguard System™ is a comprehensive business solution
for improving the quality, reliability, and speed of management
decisions. It does this by helping you Collaborate
with colleagues on important plans, Analyze
alternatives using state-of-the-art modeling and
simulation techniques, Automate routine
decisions using expert system technology, and Improve
overall management effectiveness by adding structure to
a normally chaotic process.
Business improvement is all about working smarter. Vanguard brings
together the people, analytics, and systems required to help your
business operate intelligently.
Here are just a few of the ways Vanguard supports the construction
industry:
- Cost modeling: Accurately estimate costs of
very complex projects and contracts.
- Portfolio analysis: Determine which contracts
to go after by analyzing their contributions to your project
portfolio.
- Rapid bid preparations: Reduce bid preparation
time by reusing component models from previous bids and projects
and by automating routine or complex analysis.
- Collaboration planning: Let many individuals
simultaneously contribute to the planning effort. Like building
blocks, easily combine their knowledge, assumptions, and
historical data into a complete analysis.
- Risk mitigation: Fully understand risks before
engaging in new projects. Implement risk mitigation strategies
and contingency plans early on.
- Comprehensive forecasting: Predict needs for
materials, labor, and equipment, even when historical data is
scarce.
- Resource optimization: Determine how to most
efficiently allocate scarce resources such as people, equipment,
and cash to projects.
- Operational efficiency: Conduct process
improvement/Six Sigma projects to reduce costs, cycle times, and
waste.
- Knowledge automation: Expertly guide
engineers, contractors, and technicians through complex
decision-making processes using intuitive question-and-answer
sessions.
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